Introduction
On 4 July 2025, the Ministry of Housing, Communities and Local Government, in partnership with the Welsh Government, launched a comprehensive public consultation on the implementation of the Leasehold and Freehold Reform Act 2024 (the “2024 Act”). The consultation seeks views on both the technical detail of new statutory requirements and on further reforms to strengthen protections for residential leaseholders and homeowners on freehold estates in England and Wales.
Further detail about the 2024 Act can be found in our previous law-now, available here.
Scope of the Consultation
The consultation is wide-ranging, covering both the implementation of measures already set out in the 2024 Act and proposals for additional reforms. It is structured in two main parts:
Part 1: Seeks views on how to implement parts of the 2024 Act, including the development of secondary legislation. This part focuses on transparency and standardisation in service charges, building insurance, and litigation costs, as well as enhancing leaseholder rights to information.
Part 2: Consults on further potential reforms, such as changes to the major works consultations regime, mandatory reserve funds, asset management plans, regulation of managing agents, protections for fixed service charge payers, and improvements to the process for appointing a manager.
The consultation applies to both England and Wales, with the Secretary of State responsible for implementation in England and Welsh Ministers for Wales. It also invites views on whether there are differences between the two countries that may justify divergent approaches.
Key Areas Covered by Part 1 of the Consultation
Service Charge Transparency and Standardisation: The consultation seeks views on the proposed content of service charge demand forms, annual reports, service charge accounts and administration charge schedules (with some proposed new forms of document). These measures are intended to provide leaseholders with clear, accessible, and comparable information about the charges they pay and the services they receive, enabling them to better scrutinise and challenge costs.
Building Insurance Information: Views are sought on whether buildings insurance information already provided to most landlords and managing agents under the Financial Conduct Authority rules, including details of the policy, commissions and conflicts of interest, along with further details regarding conflicts and making a claim, would be sufficient information to provide to leaseholders. The aim is to ensure leaseholders understand the value and basis of insurance costs passed on to them.
Litigation Costs Regime: The 2024 Act seeks to address the imbalance in the current system, where leaseholders can be required to pay landlords’ litigation costs even when successful in a dispute. The consultation seeks views on exemptions on litigation cost rules for debt claims and other appropriate exemptions, including suspended requirements for “resident-led buildings”. Government indicates that these new measures will not apply retrospectively to existing cases where legal proceedings have already been issued.
Key Areas Covered by Part 2 of the Consultation
Major Works and Reserve Funds: The government is seeking views on mandating reserve funds for new and existing leases, to ensure long-term planning for major works. Proposals also include raising the financial threshold for consultation on major works (to avoid capturing relatively minor works, which would otherwise add unnecessary costs and delays), streamlining the Section 20 process, and improving leaseholder engagement and transparency.
Managing Agents Regulation: The consultation proposes introducing mandatory minimum professional qualifications for managing agents, in line with Lord Best’s recommendations in his 2019 report (Lord Best's Report), to ensure agents have the necessary skills and knowledge. It also explores giving leaseholders greater powers to veto or require a change of managing agent. The proposals here do not relate to estate agents or letting agents.
Protections for Fixed Service Charge Payers: The consultation considers whether leaseholders paying fixed service charges should have equivalent rights (as the payers of variable service charge) to challenge the reasonableness of those charges and what additional transparency or protections may be appropriate.
Appointment of Managers and Redress: Proposals include simplifying and expanding the grounds for leaseholders to apply for the appointment of a manager in cases of management failure. Additionally, the consultation seeks views on a right to replace a managing agent, as recommended in Lord Best’s report.
Digitalisation and Accessibility: The government is exploring how to facilitate greater use of digital communication for providing information to leaseholders, while ensuring that those who need or prefer hard copies are not disadvantaged.
Safeguarding Leaseholder Funds: The consultation seeks views on whether current arrangements for protecting leaseholders’ money remain sufficient, or if further measures are needed, particularly in light of proposals to increase the use of reserve funds.
Differences Between England and Wales: The consultation specifically invites feedback on whether any of the proposed reforms should be adapted to reflect differences in practice or policy between England and Wales, including the use of the Welsh language.
Consultation Process and Impact Assessment
The consultation is open for 12 weeks, closing at 11:59pm on 26 September 2025. Responses will inform the development of secondary legislation and future reforms. The government is also seeking evidence on the potential costs and impacts of the proposals, including on local authorities, the justice system, and individuals with protected characteristics. The consultation can be viewed and responded to via this link.
Conclusion
This consultation marks a significant step in the government’s ongoing programme to reform the residential leasehold system with the aim of improving protections for residential leaseholders and homeowners on freehold estates. By seeking detailed views on both the implementation of the 2024 Act and further potential reforms, the government aims to ensure that new measures are robust, workable, and deliver lasting benefits for residential leaseholders across England and Wales. Whilst enhanced regulation may seem burdensome to landlords, the use of standardised documents and the potential increase in the major works consultation limit, will hopefully, in time, make management of residential leasehold property easier to navigate.
Social Media cookies collect information about you sharing information from our website via social media tools, or analytics to understand your browsing between social media tools or our Social Media campaigns and our own websites. We do this to optimise the mix of channels to provide you with our content. Details concerning the tools in use are in our Privacy Notice.